CVS Health Corporation announced on Wednesday that it is planning to buy Oak Street Health Inc for a deal worth $9.5 billion. The company revealed that it will pay $39 per Oak Street Health share; a 16% premium on the stock’s last closing price.
The decision to acquire Oak Street Health comes as CVS looks to expand its foothold in the urgent care business. Already the owner of a health insurance unit and a pharmacy benefits manager, the deal will see CVS acquire hundreds of clinics and doctors’ offices belonging to Oak Street Health.
Oak Street Health currently operates a network of 160 primary care centers that carry out activities such as routine health screenings, preventive medicine and diagnosis, and management and treatment of a wide variety of chronic health problems. The healthcare provider’s primary care centers serve patients who are insured under the U.S. government’s Medicare program. To qualify for the program, candidates have to either be aged 65 or older or possess a disability.